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Lagos, Nigeria (UPI) Sep 30, 2009 A state-owned Chinese oil giant is negotiating to buy up one-sixth of Nigeria's known oil reserves, currently owned by Western energy groups, for a reputed $30 billion to $50 billion. In strategic terms, that would be a major coup for Beijing in its global drive to secure energy supplies for China's mushrooming economy and a serious setback for the United States, which gets one-fifth of its oil imports from Nigeria. If Beijing succeeds, it would establish oil-hungry China as one of the dominant energy powers in Africa and give it access to oil that the Americans depend on to keep their economy functioning. However, the Chinese would also inherit a serious problem: the center of Nigeria's oil industry, the largest in sub-Saharan Africa, in the southern Niger Delta is under attack from rebels demanding a share of the country's oil revenues. The violence, which has raged for five years, has slashed Nigeria's oil production by about one-third. Oil theft is a multibillion-dollar industry in the trouble-plagued delta. The attacks on oil installations have decreased somewhat since the government declared an amnesty for rebels who surrender. But that is due to expire Oct. 4, and the rebels say they will resume and intensify their campaign if the government fails to meet their demands. The Financial Times has reported that the China National Offshore Oil Corp., one of China's three major oil concerns, wants to buy licenses for 23 prime blocks currently owned or operated by Western firms such as Royal Dutch Shell, Chevron and Exxon Mobil of the United States and Total of France. The licenses -- 18 onshore and five offshore -- have either expired or are due to expire over the next few years. All told these fields contain an estimated 6 billion barrels of oil. That's the same as one of every six barrels of proven oil reserves in Nigeria. That far surpasses the blocks containing some 4.7 billion barrels of oil China has acquired across Africa in its global drive to secure vast amounts of oil to fuel its mushrooming economy. Another state-owned Chinese major, Sinopec, bought Swiss oil producer Addax Petroleum Corp. in August for $7.24 billion and acquired Addax's high-potential operations in Nigeria and Gabon, as well as Iraq. That was China's most expensive overseas energy acquisition to date. Beijing has also bought up rights to oil, as well as other raw materials, across Asia and Latin America. It buys large amounts of oil from the Middle East, but as yet has not been able to buy up exclusive drilling rights in the region. The FT reported that the negotiations regarding the Nigerian zones, some of the world's richest oil blocks, were revealed in a letter from the office of President Umaru Yar'Adua to CNOOC's representative, a company named Sunrise. "The overall value of the Chinese offer is not disclosed, although some details suggest a figure of about $30 billion," the FT, which obtained a copy of the Aug. 13 letter, reported Tuesday. "Some oil sector executives said the total on the table was $50 billion." Although the Nigerian government has said the blocks up for grabs will go "to the highest bidder," it remains far from clear whether CNOOC will sweep the board and take over from Western companies that have long operated in Nigeria. But the Chinese offer, if the figures cited are accurate, appears to be far above those offered by the Western companies to extend their licenses. According to the FT, ExxonMobil offered $78 million to renew three 40-year leases that are due to expire soon. The Nigerian government demanded $2.5 billion. The sweeping Chinese bid in this latest battle for Africa's resources has thus strengthened the government's bargaining position to the detriment of the Western operators at a time when reserves are shrinking and few, if any, new strikes of any significance are being made. Share This Article With Planet Earth
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![]() ![]() Beijing (AFP) Sept 30, 2009 China's 200-billion-dollar sovereign wealth fund said Wednesday it had acquired part of a Kazakh oil and gas producer for nearly one billion dollars, marking its latest investment in natural resources. China Investment Corp (CIC) has bought around 11 percent of the Global Depositary Receipts of JSC KazMunaiGas Exploration Production for 939 million dollars, CIC said in a statement on its ... read more |
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